Is it too late to use Bitcoin to Generate Wealth?

25/10/2017

Apart from a certain US President nothing has quite dominated the headlines like Bitcoin in 2017. The alt-coin record busting ride this year has generated so much interest that its google searches have reached the highest level in its mere 8 years of existence.

Now everyone has heard numerous stories of the few investors who got in on Bitcoin at its birth and investing a mere $3000 USD and making as much as $25 million with its recent bull run. But the question is, those of us who have been standing on the side lines all this time, can we get in on it and increase our wealth or have we missed the boat?

Now not surprisingly with Bitcoins sudden dramatic rise this year where at the time of writing is currently trading at $5,656, many analysts are predicting that it is a bubble waiting to bust. But then again many were saying this month’s back when it was trading below $3,000 per coin. Though I can see a crash at some point as I have said in previous articles that I personally believe Bitcoin and few other Cryptocurrencies are here to stay so any crash if it does indeed happen with not destroy it.

So with this in mind, here are a couple of ways that if you are an individual you can still use Bitcoin to increase your wealth.

Day Trading

Now day trading is where you buy or sell a financial instrument over a short period of time, with the idea that you can profit and of course lose on the price fluctuations.

Trading the financial markets can be very profitable if you have the appropriate knowledge and discipline but it can also be extremely dangerous for those who lack the experience. As well as that, day traders often use leverage which can be a double edged sword as it can increase your profits but at the same time can it increase your downside risk.

With the sudden rise in popularity of Bitcoin a good number of brokers have started to allow day trading of Bitcoin as a CFD where you can potentially profit from buying and selling Bitcoin, so if you are one of those who believe that Bitcoin will crash then this could of interest to you. However, it is vital that you understand market trends and fundamentals that can drive the prices as this can also be extremely risky.

The old fashioned Buy and hold

Back in the day, if you had a belief that something would go up in value in the future you would simply buy it and then store it away somewhere and if you were right you would simply sell it on for a profit. Bitcoin in many ways is no different. You think of all those now Bitcoin millionaires who 8 years ago bought Bitcoin when it was trading at $0.008 and now sit on a small fortune as it trades above $5,000.

Now of course you have to first obtain a bitcoin wallet to hold them in and go through an exchange to purchase them and then at some stage sell them on. Really the question is how high can it go and will there be a crash? Bearing in mind at the time of writing it is trading at $5656, so say for example you invested about $100,000 which would allow you to own just over 17 coins and you want to try and potentially join the Bitcoin success club you would need the price to rise to $58,825 per coin with no crash. Now there are voices out there saying that Bitcoin will rise to about $100,000 in the future but to become a millionaire you would need the current value to increase by over 1000%. That number does sound daunting but if you look at the price bitcoin was trading at in January this year and its current price now it has increased in value by 500% in the last 10 months, let alone how much it has increased since its introduction 8 years ago.

But the danger is of course when will this bull run end? The naysayers have been quoting doom and gloom all year but still bitcoin has carried on rising. Even with several high profile members of the biggest investments banks shouting “bubble” and China and Russia tightening up on regulations on cryptocurrencies, still the “bust” has yet to happen. However, it could only be matter of time.

There be Bitcoins in those Mines

Now more of a complex method to potentially generate income from bitcoin is to actually mine it. To do this you need pretty advanced computers which can solve mathematical algorithms which in exchange you will receive bitcoins. To use this method, you must be extremely experienced and not really suitable for beginners. Another alternative is to join a mining pool where a group of Bitcoin miners get together and share their resources.

There are a few more ways to possibly generate income from bitcoin such as Bitcoin Faucets and I have no doubt in the future the markets will embrace many more. With bitcoin and other cryptocurrencies really gripping the world’s imagination this year its appears to me that everyone is now trying to catch up to its true potential.

We will come across many bumps in the road along the way, but in my personal opinion if banks and online services site like Amazon starting to embrace it, then it will mostly likely be here to stay and the price it will end at is anyone’s guess.

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